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    Oct 10, 2011, 07:59 PM
    Finance homework -- need help!
    1. Paulo Gattuso was cut by his team before the NFL draft. He has been playing football for 8 years and suffered an injury towards the middle of the last season and has since been in rehab. He is now likely to be a back-up middle linebacker rather than a starter. Although this is a little hard on him, he is for the most part OK with this role. He has gotten the following three offers:

    Ravens
    Quarter of a million signing bonus plus $800,000 for the first two years and $600,000 for years 3 and 4

    Chiefs
    A million dollar signing bonus and half a million dollars for each of the first three years

    Packers
    A signing bonus of $200,000 plus $750,000 for the first 2 years and $400,000 for the following three years

    Except for the signing bonus, assume all cash flows to be at the end of the year. Assume Paulo?s opportunity cost to be 7%. Which of the teams is offering him the most cash flow?

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